Trump Vows to Help Sanctioned Chinese Tech Company, Citing Job Losses

Reports suggested that the Chinese government was working on ZTE's half to find a compromise, and it looks like Chinese Premier Xi Jinping himself got in touch with the U.S. President, who said today in a tweet that is he "working... to give..." He said the "Commerce Department has been instructed to get it done!" because "too many jobs in China lost".

President Donald Trump has instructed his Commerce Department to help get a Chinese telecommunications company get "back into business" after the USA government cut off access to its American suppliers.

The Commerce Department in April cut off the massive Chinese telecom equipment maker from its USA suppliers after determining that the company flouted a 2017 agreement resolving allegations it illegally shipped telecommunications equipment to Iran and North Korea.

Those actions led to a US$1.2 billion fine previous year, with the current export ban imposed in April after ZTE allegedly failed to live up to its agreement, lying about the punishment of employees involved in the sanctions skirting.

ZTE relies on United States companies such as Qualcomm and Intel.

Trump's willingness to aid ZTE in preserving Chinese jobs comes despite his condemnations of China on the campaign trail.

Representatives from both the USA and China - which boast the world's largest economies, with nominal GDPs of almost $19.4 trillion and approximately $12 trillion, respectively - held trade talks in early May. By cutting off access to US suppliers of essential components such as microchips, the ban threatens ZTE's existence, the company has said. "This egregious behaviour can not be ignored".

There is a risk of letting any company "beholden to foreign governments" inside the country's telecommunications infrastructure, he said.

ZTE's current struggles have made it the most visible outcome thus far of a brewing trade war between the United States and China. The Defense Department in April ordered military exchanges to cease selling ZTE phones on USA bases. "China may now have strengthened its desire to get out from a under a scenario where the United States can do that again". ZTE's relationship with Google is pretty much unavoidable, such is the dominance of Android on the OS world, but allowing such a dependence everywhere else to develop over time now looks like a ridiculous development.

Experts said Trump's policy reversal was unprecedented.

FBI Director Chris Wray explained why it is an issue for companies and local governments to use Huawei or ZTE products and services.

"This is a fascinating development in a highly unusual case that has gone from a sanctions and export control case to a geopolitical one", said Washington lawyer Douglas Jacobson, who represents some of ZTE's suppliers. Oclaro, which earned 18 percent of its fiscal 2017 revenue from ZTE, fell 17 percent.

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